Listen to these characters talk about money creation and fixing our economy!

So Simple a Cartoon Can Do It!
MoneyAsWealth • December 5, 2010

A video on Fixing the Economy. At 0:40. If money exists, it had to have been created. That’s where the most important things in finance take place — at the point of money creation.

See the video here.

Bookmark and Share

3 Responses

  1. “If money exists, it had to have been created. That’s where the most important things in finance take place — at the point of money creation.”

    Bingo! That is, after all, the very rock-bottom concept in the debate over money and money creation, isn’t it?

  2. While I enjoyed listining to Byron Dale’s stories, I found his description of money creation seems a bit simplistic (this is not to be interpreted as a negative criticism). According to MMT-promoting economists such as L R Wray (UKCM) and W G MItchell (UNSW, Australia), chartalists maintain that there are two types of money creation
    (a) vertical money is created by machinations involving the Dept of Treasury and the Fed Reserve in response to Congressionally-approved limits [though Ben Bernake may recently have decided to do some more creative maneuvers which I do not really understand] and
    (b) horizontal money is created by private banks using a technique somewhat similar to that described by Byron Dale prior to 1971. However, since 1971, I think that the reserve mechanism(s) have undergone changes.
    Points which the MMT-proponents like to emphasize are that the current nature of Fed Reserve involvement should be altered so as to eliminate both the unnecessary payment of interest to the banks/’deficit hawks’ as well as the unregulated manipulations of currency and interest rates by the private banks. Since the recent disclosures tha the Fed Reserve has lent multi-billions of dollars to foreign banks and companies, it is not obvious to everyone that the Fed Reserve has been operated outside legally-prescribed limits and is essentially a rogue institution which falsely claims that it is able to optimize employment by controlling interest rates on govt bonds.

    It should be noted that MMT, if translated and expedited by competent honest regulators, could be employed to maintain an extremely low unemployment rate (suggested to be equal to or less than around 2%). By maintaining a low unemployment rate and maintaining job competence, a buffer stock of labor force could facilitate needed changes in the private sector as novel industries/techniques are created.

  3. correction:
    it is not obvious to everyone that the Fed Reserve has been operated outside legally-prescribed limits and is essentially a rogue institution which falsely claims that it is able to optimize employment by controlling interest rates on govt bonds.

    should read:

    it is now obvious to everyone that the Fed Reserve has been operated outside legally-prescribed limits and is essentially a rogue institution which falsely claims that it is able to optimize employment by controlling interest rates on govt bonds.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: